Chapter 8. Participation in the labour force

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Participation in the labour force is an essential marker of the economic integration of immigrants into Canadian society. The analysis provided here includes a descriptive study of labour force participation and unemployment rates captured in the last Census of Canada, conducted in 2006, and a more complex study in which a number of factors are introduced simultaneously to explain variations in labour force participation rates and unemployment rates between groups of immigrants defined according to the first official language spoken (FOLS).

Labour force participation rate and unemployment rate

An initial overview of the labour force participation of French FOLS immigrants in the 2006 Census1 shows that for the males in this group, the situation is comparable to that of Canadian-born Francophone males and non-Francophone immigrant males. Their overall participation rate (all working ages combined) is 72%, whereas it is 69.7% for non-Francophone Canadian-born males and 69% for non-Francophone immigrant males (table 8.1). At 6.7%, their unemployment rate is slightly lower than for Canadian-born males (7.2%), although higher than for other immigrant males (5.4%).

Table 8.1 Employment status of men and women aged 15 and over occording to immigrant status and first official language spoken, Canada less Quebec

For females too, there are differences between the groups. While the participation rate of French FOLS immigrant females is the same as for French FOLS females born in Canada (60.1% and 60% respectively), it is much higher than the rate for non-Francophone immigrant females (56%). On the other hand, for French FOLS Francophone immigrant females, the unemployment rate is higher than for the other groups at nearly 10%, compared to only 6% for Canadian-born Francophone females and slightly over 7% for non-Francophone immigrant females.

These indicators are quite sensitive to the age structure of the population. Both labour force participation and the probability of being in the situation of looking for work (unemployed) largely depend on one's place in the life cycle. Youths are especially at risk of unemployment because of their lack of experience on the labour market. Also, there are gender-related differences, due in part to the fact that women must often interrupt their work for family reasons, notably in connection with childbirth.

An analysis of age-specific participation rates and unemployment rates adds a few interesting details to the results already provided for the population as a whole. As regards participation rates, Canadian-born Francophones, both male and female, stand out from other groups in having higher rates at younger ages (ages 15 to 24 for males, 15 to 44 for females) and lower rates for persons aged 55 to 64 (chart 8.1a and 8.1b). The age curves of the three immigrant groups are almost identical.

Chart 8.1a Activity rate of men according to immigrant status, first official language spoken and age group, Canada less Quebec

Chart 8.1b Activity rate of women according to immigrant status, first official language spoken and age group, Canada less Quebec

The unemployment curves show greater variability according to age, especially for females (chart 8.1c and 8.1d). The high unemployment rate for youths is borne out in all four groups for both sexes. It reaches a peak among French FOLS immigrants, with more than 20% for both males and females. The unemployment rate remains high in this group at ages 25 to 34, although it tends toward that of French-English FOLS immigrants. In the core adult ages, the unemployment level for males varies little from one group to another.

Chart 8.1c Unemployment rate of men according to immigrant status, first official language spoken and age group, Canada less Quebec

Chart 8.1d Unemployment rate of women according to immigrant status, first official language spoken and age group, Canada less Quebec

For females, the contrast between the groups is striking. French FOLS and French-English FOLS immigrant females have the highest unemployment rates in all age groups between 15 to 24 and 45 to 54 years of age. Young Francophone immigrant females are especially affected by this phenomenon. The group least affected is Canadian-born Francophone females, while non-Francophone immigrant females have rates midway between the two.

Regional variations in participation and unemployment

This subsection examines regional variations in labour force participation rates and unemployment rates among three groups defined according to first official language spoken (FOLS) and immigrant status. Since sizable variations by age (or birth cohort) and sex within the population are observed for these two indicators, the rates were standardized by age and sex.

Participation rates show little variability among regions or among the six urban centres included in the analysis. Differences between the three groups are minimal. Canadian-born Francophones have slightly higher participation rates than the two groups consisting of immigrants, but the differences are so small that there is some question as to whether they are significant.

Chart 8.2a Activity rate (standardised by age and sex) of the population aged 16 to 64 according to immigrants status and first official language spoken (after redistribution of the French-English category) by regions, Canada less Quebec

Chart 8.2b Activity rate (standardised by age and sex) of the population aged 16 to 64 according to immigrants status and first official language spoken (after redistribution of the French-English category) for selected census metropolitan areas, Canada less Quebec

Variations in the unemployment rate are another matter. In four of the five regions and in all six CMAs selected, the unemployment rate of Francophone immigrants is higher than that of Canadian-born Francophones (which is generally the lowest of the three groups) and that of non-Francophone immigrants (chart 8.3). The unemployment rate of Francophone immigrants ranges between 6% and 11% (it is 10.8% in Ottawa). Among Canadian-born Francophones, the unemployment rate seldom exceeds 6%. There are two exceptions: in the Atlantic region, Canadian-born Francophones' unemployment rate reaches almost 11%, while outside the six urban centres it stands at 8%.

Chart 8.3a Unemployment rate (standardised by age and sex) of the population aged 16 to 64 according to immigrants status and first official language spoken (after redistribution of the French-English category) by regions, Canada less Quebec

Chart 8.3b Activity rate (standardised by age and sex) of the population aged 16 to 64 according to immigrants status and first official language spoken (after redistribution of the French-English category) for selected census metropolitan areas, Canada less Quebec

Multivariate analysis of labour force participation and unemployment

To get a better grasp of the factors that influence immigrants' labour force participation, multivariate analysis was used. This made it possible to measure the effect of a given characteristic on the participation rate and the unemployment rate while controlling for the effect of other characteristics. Given the nature of the dependent variables that take the binary form 0/1, logistic regression was chosen to carry out the analyses. Ten models were developed, five for participation rates and five for unemployment rates.

A limited number of explanatory variables (covariates) were selected, since the census has various limitations for purposes of causal analysis, one being that it offers few variables referring to a time prior to the phenomenon studied (retrospective variables), and such variables are essential for causal analysis. The explanatory variables included in the models may be grouped into three categories. First, there are control variables whose relationship with the phenomenon studied is well known but which are essential to modelling. If they were omitted, this could cause the model to be poorly specified, invalidating the results obtained. Sex and age are control variables. Second are variables measured at the same time as the independent variables: knowledge of English and French, place of residence at the time of the census and category of immigrants defined according to first official language spoken (FOLS). The causal effect of these four variables on participation and unemployment rates is uncertain, since they may be either the cause or the result of the phenomenon studied, or both at once. This is the problem of endogeneity, which is well known to econometricians. The models can provide information on the relationship between these variables and the independent variable, but any causal interpretation would be a riskier matter. Finally, three variables are retrospective in nature, meaning that they refer to a point in time preceding Census Day, making causal inference possible. These are the period of obtaining permanent residence, possession of a university diploma and continent of birth.

The same five models were developed for each phenomenon, namely the participation rate and the unemployment rate. The first three models are specific to a particular group of immigrants: French FOLS immigrants, French-English FOLS immigrants, and non-Francophone immigrants. The other two models are specific to the sexes, but they include a variable for the immigrant group, which makes it possible to compare the participation rate and the unemployment rate for these three groups controlling for the effect of the other independent variables on the explanatory variable.

Tables 8.2 to 8.5 show the results of the logistic regressions, or odds ratios,2 the statistical significance level of the coefficients and rates predicted by the model. The odds ratio measures the rate level (for participation or unemployment, as the case may be) expressed in relation to a reference category (identified by ref. in the tables). The value of the significance tests is only informative, since in models where the number of observations is very large, the significance tests are generally positive (the hypothesis is not rejected if there is a statistically significant difference between the category of interest and the reference category for the categorical variable examined). The rates or probabilities predicted by the models are especially useful because they are directly comparable to the rates calculated on the basis of descriptive statistics, and they are therefore easy to interpret. It is these predicted rates that will be discussed below.

Participation rates

Variations in the participation rates within the population generally offer few surprises. Females are less present in the labour market than males, as are younger persons (ages 15 to 24) and older persons (ages 55 to 64) in relation to the core age groups (table 8.2). The gap between males and females is as large as 10 percentage points among French FOLS immigrants and French-English FOLS immigrants and is even somewhat larger among non-Francophone immigrants (13 percentage points). In the form they take, the age curves for participation rates are entirely comparable to those shown in chart 8.1, with a plateau between ages 25 and 54 that is similar for the three immigrant groups.

Table 8.2 Odds-ratio and activity rate predicted by a logistic regression model on the activity rate of the immigrant population according to the first official language spoken for selected characteristics, Canada less Quebec

Knowledge of the official languages among French FOLS immigrants and non-Francophone immigrants is associated with greater participation in the labour force. The difference between those who know English and those who do not is substantial: among French FOLS immigrants, the participation rate is 79% for those who report knowing English and 67% for those who report that they do not know it. The corresponding percentages are respectively 78% and 65% among non-Francophone immigrants. As to a knowledge of French, there is indeed a difference among non-Francophone immigrants, but it is small, on the order of 1.5 percentage points.

The period in which permanent residence is obtained affects labour market participation. Recent acquisition (i.e., between 2001 and 2006) of permanent residence status is associated with a lower participation rate for all three immigrant groups. Among immigrants who arrived longer ago, variations in participation rates are less pronounced, although length of residence is seen to have an effect on participation: the longer ago they obtained residence, the greater is immigrants' participation in the labour market, although this duration effect levels out going further back than 1971. It is worth noting that recent immigrants have among the lowest participation rates in the population; only the 15 to 19 and 60 to 64 age groups have lower participation rates than recent immigrants.

Having a university diploma increases the participation rate, but here again, the difference between the three immigrant groups is minimal. For French FOLS immigrants, for example, the participation rate of persons holding a university diploma or certificate is almost 84%, whereas it is 76% for those who have no such qualification. This differential is borne out in the other two immigrant groups.

Immigrants' continent of birth affects participation rates, and the effect varies slightly from one immigrant group to another. With a participation rate of around 75%, labour market participation is lowest among immigrants born in Asia and the Pacific region for all three immigrant groups. In the case of French-English FOLS immigrants and non-Francophone immigrants, the participation rate of immigrants from Africa is just slightly higher than that of immigrants from Asia and the Pacific region, whereas within the French FOLS immigrant population, the participation rate of Africans is higher and comparable to that of immigrants from Europe. This probably reflects the special role that Francophone immigration from Africa plays in Francophone minority communities in Canada. For all three immigrant groups, the participation rate reaches its maximum among immigrants from the Americas, closely followed by immigrants from Europe (except for French FOLS immigrants).

Immigrants' participation rates are highest in the Prairies region (Manitoba and Saskatchewan), Alberta and the Territories (except for French-English FOLS immigrants in the latter case). In the three central provinces, immigrants' participation rate is 80% or more, while in British Columbia and the eastern provinces, the participation rate is below that level. Except in the Territories, the participation rate for the three immigrant groups is similar from one region to another.

Differences in participation rates in the population are greater for females than for males. This result can be seen for all variables included in the regression model (table 8.3). For example, the difference between those who speak English and those who do not is 10 percentage points for males (85.4% versus 75.7%), but it reaches 16 percentage points for females (72.2% versus 55.7%). The same applies to possession of a university degree: for males, the participation rate for university graduates is 87.5% compared to 84.2% for non-graduates, a gap of three percentage points. For females, the rates are respectively 77% and 69%, representing an absolute difference of 8 percentage points. For the immigrant group variable, the pattern is similar: the participation rate is the same for males in all three groups, while for females, French-English FOLS immigrants stand out from the other two groups with a participation rate that is 5 percentage points lower.

Table 8.3 Odds-ratio and activity rate predicted by a logistic regression model on the activity rate of the immigrant population according to the first official language spoken for selected characteristics by sex, Canada less Quebec

Unemployment rates

As with participation rates, age- and sex-specific unemployment rates predicted by the regression models confirm the results calculated on the basis of descriptive statistics: for the three immigrant groups, female unemployment and youth unemployment are higher than for the other demographic subgroups (table 8.4). French FOLS immigrant women have an unemployment rate slightly above 9%, while the rate for their male counterparts is below 7%. By age, the rate for youths aged 15 to 19 is especially high at 18.3%, which exceeds not only the rates for the other age groups but also those for the same age group among French-English FOLS immigrants (13.9%) and non-Francophone immigrants (14.3%).

Table 8.4 Odds-ratio and unemployment rate predicted by a logistic regression model on the unemployment rate of the immigrant population according to the first official language spoken for selected characteristics, Canada less Quebec

Knowledge of official languages is negatively associated with the unemployment rate only in the case of knowledge of English. The unemployment rate for French FOLS immigrants and non-Francophone immigrants who report not knowing English is three percentage points higher than for those who report knowing it. There is no difference in the unemployment rate based on the knowledge of French for non-Francophone immigrants.

Immigrants who obtained their permanent residence status between 2001 and 2006 register unemployment rates above 10% in all three immigrant groups. Among French FOLS immigrants, those who came to Canada during the five-year period from 1996 to 2000 also have an unemployment rate exceeding 10%.

Having a university degree slightly reduces the probability of being unemployed during the week preceding Census Day, but the difference with those who do not have such a credential is small, less than two percentage points, and it is scarcely a half percentage point for non-Francophone immigrants (6.7% and 6.2% respectively).

The continent of birth plays a considerable role in the unemployment rate of French FOLS immigrants and French-English FOLS immigrants. The groups most affected by unemployment are Africans and Asians; Europeans are the least affected. Immigrants from the Americas have a lower unemployment rate than immigrants from Africa, Asia and the Pacific region, with the exception of French FOLS immigrants. Among the latter, the difference between continents of birth essentially contrasts immigrants from Europe, with a rate of 5.4%, and the rest of immigrants, with an unemployment rate exceeding 9%.

Unemployment by region of residence also varies according to the immigrant group, although the general trend shows that residents of the Prairies and Alberta have a lower unemployment rate than residents of the other regions. An east-west division is evident among French FOLS immigrants and non-Francophone immigrants but not among French-English FOLS immigrants, for whom the unemployment rate peaks in British Columbia (at nearly 10%).

Unemployment is higher for females than for males in all socio-demographic sub-groups, including the immigrant groups. However, there is one exception: the unemployment rate for youths aged 15 to 24 is higher for males (15% and 11% for 15 to 19-year-olds and 20 to 24 year-olds respectively) than for females (13% and 10% for 15 to 19 year-olds and 20 to 24 year-olds respectively) (table 8.5). Differences between immigrant groups show that French FOLS immigrants and French-English FOLS immigrants have a higher unemployment rate than non-Francophone immigrants, for both males and females.

Table 8.5 Odds-ratio and unemployment rate predicted by a logistic regression model on the unemployment rate of the immigrant population according to the first official language spoken for selected characteristics by sex, Canada less Quebec

In summary, an analysis of participation and unemployment rates reveals that there are few differences between immigrant groups, although non-Francophone immigrants have a lower unemployment rate than French FOLS and French-English FOLS immigrants. Instead, socioeconomic characteristics determine the extent to which immigrants integrate into the Canadian labour market. The period of arrival in Canada is important in this regard, as is the continent of birth: immigrants from African appear to be at a particular disadvantage. It seems that knowledge of English and the region of residence also have a major effect on immigrants' economic integration, but as noted at the beginning of this section, there is uncertainty as to the direction of the causal relationship between these two characteristics and the participation and unemployment rates.


Notes

  1. Based on employment status during the week (from Sunday to Saturday) preceding Census Day (May 16, 2006). The participation rate is calculated as the number of persons in the labour force (employed or looking for work) in relation to the total working-age population. The unemployment rate is the ratio between the number of persons looking for work and the labour force. These rates are expressed as a percentage.
  2. The odds ratio is the ratio of the odds of an event occurring in one group to the odds of it occurring in another group. An odds ratio of 1 indicates that the condition or event under study is equally likely to occur in both groups. An odds ratio greater than 1 indicates that the condition or event is more likely to occur in the first group. And an odds ratio less than 1 indicates that the condition or event is less likely to occur in the first group.

 

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